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Technology, technology, and more technology—this is what has driven the American oil and gas boom starting in the Bakken and now being played out in the Gulf of Mexico revival, and new advances are coming online constantly. It's enough to rival the Saudis, if the Kingdom allows it to happen. Along with this boom come both promise and fear and a fast-paced regulatory environment that still needs to find the proper balance.
In an exclusive interview with Oilprice.com, Chris Faulkner, CEO of Breitling Energy Companies—a key player in Bakken with a penchant for leading the new technology charge—discusses:
James Stafford: How important are Bakken and Three Forks to US energy in the big picture?
Chris Faulkner: The Bakken Shale has been the biggest driver in America's reversal of decades of decline in oil production. It has transformed North Dakota into an economic powerhouse with the nation's lowest unemployment rate and fastest-growing GDP—and an oil production level surpassing that of some OPEC nations. An added increment of almost 800,000 barrels per day of oil output, built in less than a decade, has helped the US reduce its dependency on oil imports from often hostile countries by 22% since peaking in the mid-2000s.
US oil production is at its highest level since 1992, and in another 5 years, it is projected to reach its highest level since 1972. More importantly, the US oil production surge will help tamp down the possibility of chronically recurring oil supply shortages and help keep a lid on oil price spikes for the foreseeable future. Additionally, the Bakken surge is helping to narrow the spread between WTI and Brent, providing even more economic incentive to develop the costly unconventional resource plays.
James Stafford: The US government recently more than doubled its estimates for Bakken and Three Forks to 7.4 billion barrels of undiscovered and technically recoverable oil and 6.7 trillion cubic feet of natural gas. How is the industry responding to this? How are investors responding?
Chris Faulkner: Some operators had already been developing the Three Forks formation ahead of the USGS revised estimate for the Greater Bakken play. That drilling in fact provided much of the knowledge about the Three Forks that led to the USGS upgrade. We're already seeing stepped-up drilling in the Three Forks, and some of that will entail dual horizontal laterals, a real milestone that could yield spectacular IP rates. Accordingly, Wall Street analysts are upgrading their guidance on companies such as Continental Resources that are leading the Bakken charge.
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